Pending home sales increased in March and remain above year-ago levels. However, contract activity in recent months shows only modest movement, according to the National Association of REALTORS®.
The Pending Home Sales Index, a forward-looking indicator based on contract signings, rose 1.5 percent in March, over a downwardly revised figure in February. The index is 7 percent above year-ago numbers, reflecting the fact that pending sales have been above year-ago levels for the past 23 months.
“Contract activity has been in a narrow range in recent months, not from a pause in demand but because of limited supply. Little movement is expected in near-term sales closings, but they should edge up modestly as the year progresses,” says Lawrence Yun, NAR chief economist. “Job additions and rising household wealth will continue to support housing demand.”
In the Northeast, the index was unchanged in March, but is 6.3 percent higher than in March 2012. In the Midwest the index increased 0.3 percent, 13.7 percent above a year ago. Pending home sales in the South rose 2.7 percent, which is 10.4 percent higher than March 2012. In the West the index increased 1.5 percent, but is 4.3 percent below a year ago.
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